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Morgan Stanley Sees Meaningful Upside to GMs for Avago Technology Ltd.

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In a report published Wednesday, Morgan Stanley analyst Craig Hettenbach reiterated an Overweight rating and $68.00 price target on Avago Technologies Ltd. (NASDAQ: AVGO).

In the report, Morgan Stanley noted, “We are Overweight AVGO as the company's above-average growth, strong FCF, diversified revenue stream (after LSI), and consistently high profitability is not reflected in the current multiple (P/E of ~10x pro-forma 2015 EPS for the combined company). We have high conviction in management's ability to execute on driving LSI's OMs from 17% to 30% over the next few years. Notably, Avago doubled its OMs from 15% to 30% post the company's LBO and is very effective at maximizing pricing for its IP, which we think will benefit the LSI business.”

Avago Technologies Ltd. closed on Tuesday at $59.00.

Latest Ratings for AVGO

DateFirmActionFromTo
Dec 2016Loop CapitalInitiates Coverage OnBuy
Nov 2016Pacific CrestMaintainsOverweight
Oct 2016Wells FargoInitiates Coverage onMarket Perform

View More Analyst Ratings for AVGO
View the Latest Analyst Ratings

Posted-In: Craig Hettenbach Morgan StanleyAnalyst Color Reiteration Analyst Ratings

 

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